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The Tragedy of the Commons

August 30, 2011 | bit-wartung | Learning Elsewhere, SDC Experiences |

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Rating: 4.6 out of 5

Tenders and offers seen through the lenses of learning and sustainability

by Ernst Bolliger Agridea / Ernst BolligerTeam international

Preface: Preparing for an evaluation mission of SDC’s Mongolia Green Gold project (three key words: the Tragedy of the Commons – pasture management – herder associations) I have pictures of overgrazed pastureland, herds of cattle, goat, sheep, camels and horses in front of my eyes. In this vast landscape with generally scarce pastures there are some green spots, attractive for all herders to drive their herds for grazing.
Cut.
Change of the scene.

Some two years ago, a parliamentary audit made it clear: SDC does not follow the rules about public tendering of their mandates. 85% of the mandates have been awarded without a formal tendering process according to the rules of the WTO. Since then, SDC has got clear and strict instructions about tendering mandates. Everybody knows what limits the figures CHF 50’000/150’000 and CHF 230’000 stand for: Direct mandate, short-list tendering, formal open tendering.

I work for a NGO. We are involved in the process of tenders and offers. We invest time in drafting offers, lots of time. SDC is investing time in drafting tenders, lots of time. I can’t but start calculating the amount of time invested and assessing the impact on learning and exchange.

For small mandates, SDC invests roughly two days for drafting a tender. Let’s say four organizations submit an offer, each organisation investing four days. SDC has to select. This is done in a team. Three persons sit for half a day, read, discuss, assess, and decide. One person is in charge to communicate the decision, another half a day. There are one happy and three unhappy organizations. With the unhappy organizations there will be phone calls, explanations, some more hours. With the happy winner, the constructive cooperation can start.
Did you calculate the total of days invested to be at the start of the constructive dialogue with the winning organization? Twenty days of work. A small mandate normally covers about 100 to 150 working days within a period of one to two years. 15 – 20% of the mandate’s time are used just to select the best partner organization, time invested in an administrative procedure. For bigger mandates (covering maybe 500 to 1000 working days in a period of three years) it is about the same – just replace the word days by weeks and you are not far from reality.

Is this really worth the effort? Is the expected transparency, justice, quality, efficiency, effectiveness end impact really gained? Or is it an illusion? Wouldn’t we better invest the time in a joint learning process?

I come back to my picture of Mongolia: The green spot in a vast rangeland. With the prevailing selection processes applied for small mandates, isn’t SDC acting like a Mongolian herder: Just looking for the greenest spot in the accessible surroundings – the best opportunity for the lowest prize? Not caring about the conditions that the green spots remain green spots? Isn’t the tendering procedure pushing SDC in a direction as the Mongolian herders have been pushed after the big changes in 1990? Is this the “Tragedy of the Commons” in modern WTO sensitive administrations?

As a consultant and representative of a NGO I am at times confronted with a tender that contains obvious wrong estimates (e.g. forgotten preparation time, e-discussion cycles with time estimates that do not allow reaching the stated objectives, no time for a reasonable follow-up)? The tender process is a formal process; it does not allow an open dialogue, though there would be a dialogue needed. Instead we start a poker game with all its rules, techniques and tricks.

Instead of this kind of tender-offer-poker-game, I would prefer an open learning process as I experienced a lot of them – creative, effective, efficient and motivating ones.

I think back to earlier periods of cooperation between SDC and partner organizations and I recognize a clear difference. SDC established partnerships with recognized organisations having a vast experience in the respective domain. With the internal principle of job rotation (SDC staff changing their job every four to eight years), SDC was aware of not being able to assure the continuity of thematic leadership. SDC established cooperation contracts with a range of thematic partner organizations, always keeping a minimal ownership of the theme within SDC. SDC invested in thematic competence in partner institutions.
I know, in such a setting there is the risk of “Seilschaften”, translated into English as “rope team” or “insider relation” or “insider deal”. This has to be taken serious, no doubt. But good relations, a common vision and a common language are the best basis for a fruitful cooperation. Just make sure to keep doors open for newcomers. It is inspiring to have new members in a rope team – in the development work as well as on a mountain tour.

There is one more thought I would like to add. In the public political dialogue on international cooperation the term “Swissness” is heard quite often. Is SDC really serious about it? What does SDC do that organizations are able to keep a “Swiss quality standard”?

If I speak for myself and for the NGO I am working for: We are interested in keeping up to high standards. We are interested to invest time and money in coaching junior staff to bring them to a recognized level. We are interested in contributing to “Swissness”. And we are interested in learning processes that contribute effectively to development.

We hope, it will be possible to reduce the tender-offer procedures to a minimum in favour of more inspiring interaction and learning.

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Comments to“The Tragedy of the Commons”


  1. The worst experience recently: 10 invited parties to offer for a mandate of 28’000 CHF …

    I propose a constructive dialogue with the aim to develop a “policy”, not only for tendering but also for calculating tariffs.
    I welcome the steps made by the SDC contracting division. There is openess to discuss the issues.
    All factors need to be taken into account: salaries in the private and the Government sector, cost structure of NGOs and consultants, and legal requirements.

    Some observations and recommendations:
    (1) In invitation tenders, invite max. 5 organizations.
    (2) Also in invitation tenders, make the names of the invitied firms known to all. This is the practice in many public sector organizations. And it allows the invited firms, to make an assessment about their chances. If needed, they can submit a joint offer. All parties will have at the end a benefit. SDC: strong proposals; good quality of work; innovation; e.g. international firms teaming up with Swiss organizations; Tendering organizations: a good basis for making a choice where to invest the (finally) limited resources for the preparation of tenders.
    (3) Develop (and update) a list with tariff recommendations; see e.g. KBOB tariffs, formulated in a round table and applied by cantonal and federal offices. The system is in place for 25 years.

    I consider point (3) important.
    In development cooperation, you are often competing in an international market, with different cultures and expectations respectively rules (of fairness). NGOs are competing with firms, University institutes, etc. (from all over the world).
    If there are no tarif recommendations, the organizations which prepare offers operate in an unfair context.

    To conclude, lets sit at a “think table” to make the system more efficient. SDC contract division made a first step.

    HARDESTY wrote the Tragedy of the Commons. In a business and NGO world, the “Commons” are in particular risk capital, capital for investments, capacity to invest into young staff and new ideas, into innovations.

    What are your experiences?

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